Development of an Integrated Solid Waste Management Project with WtE Plant at Njalianparambu, Kozhikode on DBFOT basis under PPP mode

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1 Kerala State Industrial Development Corporation T.C. XI/266, Keston Road, Kowdiar, Thiruvananthapuram Tel: , Fax: Web: Development of an Integrated Solid Waste Management Project with WtE Plant at Njalianparambu, Kozhikode on DBFOT basis under PPP mode CORRIGENDUM NOTICE FOR INTERNATIONAL COMPETITIVE e-bid Date:- 26 th December 2018 The Corrigendum with respect to the for " Integrated Solid Waste Management with a Waste to Energy (WTE) Project of minimum 300 TPD Processing capacity on Design, Build, Finance, Operate and Transfer (DBFOT) basis at Njalianparambu, Kozhikode District in the State of Kerala for Kozhikode Corporation, Government of Kerala under Public Private Partnership", raised during pre-bid meeting on December 10, 2018, at KSIDC Corporate Office, Keston Road, Kowdiar, Trivandrum (. : KSIDC/W2E/2/2018 Date 22 nd November 2018.) Sr. 1. Zonta Vol 1, Section A, Page 12, Clause 6 Key Details S. 8: Completion We request you to modify the clause as below: The concession period is pre-determined and fixed as 25 (Twenty- Five) years from the date of commencement of commercial operation by the Plant set up under the Project, which shall be achieved within 2 (Two) years from the Compliance Date (As defined in Clause of Draft Concession Agreement) or achieving the Financial Closure whichever is later. The concession period is 25 (Twenty-Five) years from the date of commencement of commercial operation. The Construction and Commissioning Period is maximum 24 (Twenty Four) months from the completion of Condition Precedent. Accordingly Clause 4.3 of the Document, 1

2 Vol 1, Section A, Page 17, Clause 9 Concession Period Rationale: Clauses 6 and 9 and contradict each other as in clause 6 it is mentioned that completion period of work is 24 months from the completion of Conditions Precedent specified in Concession Agreement whereas as per clause 9 the COD shall be achieved within 2 Years from the date of concession agreement. For Commencing the Construction Activities for Waste to Energy Plant, all the Conditions Precedents including Statutory Approvals, Power Purchase Agreement (PPA), Financial Closure etc. as defined in Clause 2.6 of DCA have to be achieved. Clause 6 of the document - Key details Sl. 8 and Clause 9 of the document stands modified as given in Appendix Zonta Vol 1, Section A, Page 10, Clause 4 - Minimum Eligibility Criteria: Clause 4.3: Stipulated Criteria A. Technical Capacity Thus, we understand that the date of commencement of commercial operation by the Plant set up under the Project to be 2 years from the Compliance Date as defined in Clause of Draft Concession Agreement. Please Clarify We request you to modify the clauses as below: Clause 4.3 A- Conditions for Consortium At least one member of the consortium (not being an individual) shall meet this criterion. Clause 5.4, Clause 10.4 & Appendix-V Sub-Clause 6.2: We request you to please delete the clause Ratonale: As per, the Technical Capacity with respect to experience of design & Development of at least one WTE plant or having successful operation of at least one WTE energy plant for minimum period of 1 year is to be met by at least one consortium member holding more than 26% stake. The Lead member and a member of the consortium meeting either the Technical Capacity or Financial Capacity shall each have an equity share holding of at least 26% of the paid up and subscribed equity of the SPV. Clause 4.2, 4.3, 5.3, 5.4 and 10.4 of the Document, Clause 6 of the document stands modified as given in Appendix 1.. This condition of consortium member mandatorily shall hold 26% Vol 1, Page is restricting participation of Technical Partners who have proven 11, Section A, 5.4 technology and required technical experience and expertise. Conditions for Global companies in general are averse to be a participant in the formation of equity of a project in India and their general preference is to be Consortium the technical partner who will take up the project in an EPC 2

3 Vol 1, Page 18, Section B, Clause 10.4 Special Vehicle Purpose Vol 1, Page 59 Appendix-V Clause 6: Shareholding in the SPV Sub- Clause 6.2 model under an arrangement between the Indian partner and the overseas Technology Provider. This is the model prevalent in all newly developed technological sectors in the country including that of the few WTE projects came up recently in India. Thus, we request that it should not be made mandatory to have equity stake for such Technical Partner, to be able to participate in the bid and should be left to the discretion of the consortium. The authorities may refer similar tenders where the qualification is made simpler to enable technically capable foreign companies to tie up with suitable waste to energy Indian companies without having the mandatory equity participation from the Technical Partner. 3. Zonta Vol 1, We request you to modify the clause as below: Financial Capacity remains unchanged. Section A, Page For demonstrating financial capacity (the Financial Capacity ), 10, 4. Minimum the Bidder shall have a minimum consolidated Turnover of INR. Eligibility 250,000,000/- (Indian Rupees Two Hundred Fifty Million) or its equivalent in US Dollars, converted as per specified Exchange Criteria: 4. 3 Conversion Method given in Annex-III-A of Appendix I, as per B. Financial the Latest Audited Financial Statement. For this clause, the Capacity closure of latest financial year shall not be before 31st March Rationale: The underlying logic of the request is that the companies that are in the WTE segment in India including Overseas subsidiaries are fairly new and as such having Net worth in a short span of time to the extent of the requirement provided in the current is impossible. In order for a fair competition, we would request an amendment to this clause. This is particularly because the responsibility of bringing the investment lies with the successful bidder. 3

4 4. Zonta Vol 1, Section A, Page 11, Clause 5. Conditions for Formation of Consortium The authorities may also refer similar tenders issued where the financial capacity is based on the Consolidated Annual Turnover and hence we request to please consider Consolidated Annual Turnover as the Financial Eligibility Criteria. We request you to modify the clause 5.3 as below: Any one of the consortium members shall be nominated as the Lead Member of Consortium provided such lead member holds a minimum of 26% equity in the Consortium/ SPV. OR Alternatively, the following language may be provided: The member of a consortium meeting either of the Technical Capacity as per 4.3 (i) or 4.3 (ii) or of the Financial Capacity or both could only be appointed as Lead Member of Consortium. Any member of the consortium could be appointed as Lead Bidder and the Lead Bidder should be in existence from last 3 years. Clause 5.3 of document stands modified as given in Appendix 1. Rationale: As per 4.3A (i), the Lead Member shall be in continuous existence for minimum 3 years as on 1 st April 2018 and has been in operation since the last three financial years; while, clause 5.3 mentions that only consortium member meeting technical capacity which includes technical experience of design & development or successful operation of at least one Waste to Energy Plant As all know, the Waste to Energy projects in India are only a handful and the sector is reeling under heavy financial as well as technical stress. Since the intent of the public authorities is to bring feasible technologies and investment for WTE projects, it is important that the Indian Partner shall be allowed as the Lead Partner. Current language in the is restrictive in such a way that only companies complying with technical or financial capacity can only be identified as the Lead Member. Hence, adequate changes may be made to the requirements so that the selection of Lead Member is left to the consortium members. 5. Zonta Vol.1, We bring to you kind attention that as per the General Financial remains unchanged. 4

5 Section A, Page 13, Clause 6 - Key Details, S. 5: Bid Security Amount (EMD) INR 10 Million/- Rules (GFR), 2017, Rule 170(i), To safeguard against a bidder s withdrawing or altering its bid during the bid validity period in case of advertised or limited tender enquiry, Bid Security (Also known as Earnest Money) is to be obtained from the bidders except Micro and Small Enterprises (MSEs) as defined in MSE Procurement Policy issued by Department of MSME or registered with the Central Purchase Organization or Startups as recognized by DIPP. 6. Zonta We are a registered MSE and a Startup firm as recognized by Vol.1, DIPP and thus request you to kindly confirm if the EMD is Section B, Page exempted for us. However, if EMD is not exempted, we 28, humbly request you to kindly reduce the EMD amount to INR Clause 28.1 Bid 2 Million (INR 2,000,000/-) to enable more prospective Security bidders and to encourage competitive bidding. Vol I, We request you to modify the clause as: remains unchanged. Section B, Page The selected private partner shall strive to minimize the 18, landfill requirement but in no circumstances, the landfill shall be receiving waste more than the permitted/defined limit as per Sub Clause SWM Rules 2016 issued by MoEF&CC for landfilling (excluding Construction & Demolition waste) at the Site (to be monitored on a monthly basis). Rationale: We have no control of inerts and ash content present in the waste supplied at the facility and thus Landfill requirement of maximum 10% of waste received at the site allowed cannot be ensured. Further, we also do not have detailed waste characteristics spread for the complete year to assess the quantum of inerts and ash content expected in the waste supply to site. Thus, the maximum allowed inerts for landfilling shall be considered as per SWM Rules 2016 issued by MoEF&CC. However, we shall endeavor to minimize the landfillable waste quantity. The authorities may also refer similar tenders issued and 5

6 7. Zonta 8. Zonta 9. Zonta Vol I, Section B, Page 18, Clause Vol I, Section B, Page 19, Clause consider the request. We request you to modify the clause as: The selected private partner shall strive to minimize the landfill requirement but in no circumstances, the landfill shall be receiving waste more than the permitted/defined limit as per SWM Rules 2016 issued by MoEF&CC for landfilling (excluding Construction & Demolition waste) at the Site (to be monitored on a monthly basis). Rationale: It is mentioned that the landfillable waste includes construction and demolition waste. As per and Concession Agreement, Construction & Demolition waste is Excluded. Therefore, LSGIs shall ensure supply of waste to site excluding C & D Waste. Representative may be deployed only as and when required for redressal of any service complaint because full time deputation at each LSGI are not required and it will increase the cost of operations and hence the project may become unviable. Further, we would be nominating one Concessionaire s Representative (Team Leader) who shall be responsible for cluster wide operation of the Project. Team Leader will be supported by a team. Clause of document stands revised as given in Appendix 1 Bidder shall be free to deploy resources on need basis subject to meeting all concessionaire obligations. We request you to please confirm that deployment is only on as need basis. Vol.1 We request you to modify the clauses as below: remains unchanged Section B, Page Vol.1 20, Page 20, Sec B Role of the Authority, Cl : Role of the In case LSGI fails to assure the minimum assured quantity, Authority, Authority, will be liable to pay penalty to SPV calculated at 100% Clause : of the corresponding year Tipping Fee per ton plus equivalent tariff compensation for each ton of shortfall. Rationale: WTE Plant Power Output will be computed based on 6

7 10. Zonta 11. Zonta the minimum guaranteed waste supply of 300 TPD and accordingly revenues are considered. Any shortfall in waste supply quantity will affect both our revenues from tariff and tipping fee. We, therefore, request the authority to consider 100% of the corresponding year Tipping Fee per ton plus equivalent tariff compensation for each ton of shortfall of minimum guaranteed waste supply. Vol.1 Page 20, Sec B We request you to delete this clause. remains unchanged Role of the Rationale: Since the minimum waste supply quantity is 300 TPD, Authority, Clause we request the Authority to delete this statement, which would : otherwise ensure only 270 TPD of minimum guaranteed waste. Vol.1 Page 26, Sec C, Cl. 23 Site Visit and Verification of Information: Please clarify and confirm the scope. On site visit, it is noted that the areas on both sides of the access road from main entry gate up to existing waste receiving plant building, within plant boundary, are already dumped with wastes and landfilled. These areas, as already proposed by the Project Consultant for the proposed WtE plant construction, in their study report, are necessarily to be cleared for the new plant construction. It is clarified that it is the responsibility of the Concessionaire to remove the existing legacy waste at the site as per his/ her construction management plan. The concessionaire shall take over and operate the existing waste to compost plant and continue operating it till COD of the Waste to Energy plant is achieved as clearly specified in Clause 5.2 (cc) of the Concession Agreement. We propose the following steps for WtE plant construction An additional land of 4 acres is available at the feasibility: site under the possession of Corporation which Step 1: Divert the present waste quantity of 70 to 75 TPD can be used for the managing the constructruction transferred to the existing site to other suitable locations during at the site, till the COD of the Waste to Energy the proposed WtE plant construction period. plant is achieved. Step 2: Demolish the existing Compost plant building to pave way for Landfill construction. Step 3: Start constructing the scientific landfill. Step 4: Segregate the wastes already landfilled/dumped in the areas identified for WtE plant construction using the existing trommels and segregation equipment. Segregate the composting and incinerable wastes and store in a separate covered area, for 7

8 12. Zonta 13. Zonta Vol.1 Page 28, Section C Bid Security Cl 28.2 Vol.1, Section C, Page 33, Clause Technical Scoring Criteria Vol.1, Page 33, Section C, Cl 33.1 Financial Evaluation: use after commissioning of the new WtE plant. Inerts and other unsuitable segregated wastes shall be landfilled. Step 5: Plan and build the WtE plant in the identified areas. Step 6: After commissioning of the WtE plant, process and clear the stored useful wastes along with the new waste quantities transferred to site on daily basis. The above process is required to recover the site areas for the proposed new plant construction. We, therefore, request the Authority to remove the existing legacy waste/waste dumps at Site and handover a levelled and clear site to the Concessionaire. We request you to modify the clause as: The Bidder may choose to submit the Bid Security in the form of a Bank Guarantee or Fixed Deposit Receipt (FDR). Rationale: We request the Authority to consider acceptance of Fixed Deposit Receipt (FDR), drawn in favor of the designated Authority as an additional alternate which will reduce the process time taken to obtain the EMD from banks. We request you to modify the clause 33.1 as below: Price Bids of Prequalified Bidders who have got minimum technical score of 65 marks only will be opened for Financial Evaluation Rationale: As per, the technical score is only applicable if there are two or more prequalified bidders quoting same tipping fee and there are no minimum eligible marks for opening of financial proposals. Please indicate the minimum marks criteria for qualifying / rejection of technical bids submitted by Bidders and also please confirm that financial bids of those technically qualified bidders shall only be considered for opening. Fixed Deposit Receipt (FDR), leaned in favour of KSIDC is acceptable. The Fixed Deposit shall be payable at Thirvanthapuram, Kerala. remains unchanged As per there is a Detailed Technical Evaluation and Technical Scoring Criteria vide clause However, there is 8

9 14. Zonta 15. Zonta 16. Zonta 17. Zonta 18. Zonta Vol.1 Page 59, Appendix V- Joint Bidding Agreement Cl.6. Shareholding in the SPV Vol.1 Page 63, Appendix VI- Technical Proposal Note 1. Vol.1 Page 16, Sec B Cl. 8.1: no minimum technical eligibility score provided for the prequalified Bidders. We request you to include minimum technical eligibility score so that technically competent bidders are only eligible for Financial Opening and evaluation. We request you to delete this clause. remains unchanged As mentioned above in Sl. No1, there shall not be any equity shareholding restrictions and shall be left to the consortium to enable active participation from competent players. We request you to please confirm We presume the production capacity of 5 MW specified to be the Gross Power produced at the generator terminal and not the net power supplied at the substation grid. 5 MW specified is the tenative Gross Power produced Vol.1 We request you to please confirm Clarification provided under Sl. 11. Page 16, Sec B Cl. Kindly refer the clarification sought/justification provided in 8.3: S. 11. Vol.1 We request you to please confirm remains unchanged. Page 19, Sec 11: As per and draft DCA reference clauses as mentioned beside, Scope of work for the number of Weigh Bridges to be set-up are cited different and As specified in Clause 5.14 of the Schedules to Concession Agreement, 2 (two) Weighbridges are private partner, Cl are not matching. required to be provided at Plant Site Please note that only one weighbridge at site will be considered for the measurement purpose. Draft Concession We request you to modify the clauses as below: DCA remains unchanged Agreement, Page Draft Concession Agreement, Page 46, Article 7, Cl. 7.1 (f) 46, Article 7, Cl. In case LSGI fails to ensure the minimum assured quantity as set 7.1 (f) under this Agreement, as evidenced by measurement at the weighbridge checked daily by PMU and/or Concessionaire, the 9

10 Concessionaire shall be liable to claim penalties for nonfulfilment/ damages, calculated at 100% of the corresponding year Tipping Fee per ton plus equivalent tariff compensation for each ton of shortfall. 19. Zonta 20. Zonta 21. Zonta Rationale: Our Power Output will be computed based on the minimum guaranteed waste supply of 300 TPD and accordingly revenues are considered. Any shortfall in waste supply quantity will affect both our revenues from tariff and tipping fee. We, therefore, request the authority to consider 100% of the corresponding year Tipping Fee per ton plus equivalent tariff compensation for each ton of shortfall of minimum guaranteed waste supply. Draft Concession We request you to delete this clause. DCA remains unchanged Agreement, Page Kindly refer the clarification sought/justification provided in 46, Article 7, Cl. S (f) Draft Concession We request you to modify the clauses as below: DCA remains unchanged Agreement, Page The Authority through itself, or through the PLBs shall ensure 30, Article3: Sites, that within 30 days from the Appointed Date, it shall handover the Cl.3.1 Handover Sites under their respective jurisdiction for Processing Facility, of sites Landfill, Transfer Stations, Material Recovery Facility to the Concessionaire after removing the existing legacy waste/waste dumps at site and levelled and cleared site free from all Encumbrance, for the purpose of implementing the Project. Draft Concession Please clarify and confirm the scope. DCA remains unchanged Agreement, Page (b) Facilitated and ensured that Land Lease Agreement(s) are 30, Article3: Sites, executed for the Project Site after removal of existing legacy Cl.3.1 Handover waste/waste dumps at site and Cleared, vacant and of sites unencumbered possession of all the Site(s) is handed over to the Concessionaire 10

11 22. Zonta 23. Zonta 24. Zonta Draft Concession Agreement, Page 26, Article 2, Cl Kindly refer the clarification sought/justification provided in S. 11. We request you to please confirm if the Environment Clearance for the site is already obtained or if the same has to be also applied. Enviornment Clerance for the landfill is the responsibility of the Concessionaire and shall be undertaken as part of the scope of the work. Draft Concession We request you to please include additional clause cl (e): DCA remains unchanged Agreement, Page 27, Article 2, Cl. Rationale: Identified alternative disposal site for dumping of waste being generated during the Waste to Energy plant construction period before Contract signing date and should have made necessary arrangements to divert the interim waste to this alternate site till COD. Draft Concession We request you to please modify the clause as below: DCA remains unchanged Agreement, Page 27, Article 2, Cl. Conditions Precedent for Concessionaire (b) Prepared and submitted a Detailed Project Report, covering technology proposed, demand assessment, technical feasibility, detailed cost estimates, capital investment plan, project financing details, revenue projections, environment & social impact assessment and detailed financial analysis, to the Authority, consistent with the technical plan submitted during the bidding stage within 6 months from Appointed Date. Rationale: The EIA and SIA studies are subject to the Terms of erence issued by the respective Pollution Control Board/ MoEF & CC as applicable. These authorities generally seek detailed data on pre-monsoon and post-monsoon assessment which takes a minimum of 6-8 months. In view of this, we request you to consider to provide minimum of 6 months time for submitting the required reports and also consider to provide 11

12 25. Zonta 26. Zonta 27. Zonta 28. Zonta waiver on conditions precedent and provide necessary extension to such time period as required. Draft Concession We request you to please modify the clause as below: DCA remains unchanged Agreement, Page (j) Signed and Procured execution of Power Purchase Agreement 28, Article 2, Cl. (PPA) with Kerala State Electricity Regulatory Commission (the Power regulator ) for fixing power tariff for the Waste Processing Plant to be paid by KSEB, as provided in the Power Purchase Agreement (PPA) Rationale: Without a firm Power Purchase Agreement and Tariff Fixation the Concessioner will not be able to achieve Financial Closure. Banks/FIs requires compliance of all the conditions precedent including DPR, Statutory Approvals and Power Purchase Agreement before sanctioning the debt for the Project Financing. The project is Financially viable only with a firm PPA and Financial Closure, so, we request you to consider signing of PPA to be one of the Conditions Precedent. Draft Concession We request you to kindly confirm DCA remains unchanged Agreement, Page The definition of Compliance date should be same as defined in 28, Article 2, Cl. clause Draft Concession We request you to kindly consider the change DCA remains unchanged Agreement, Page It is mentioned in this clause on event of non-fulfillment 28, Article 2, Cl. Conditions Precedent by the Concessionaire, Authority Shall Forfeit and en-cash the Performance Security; whilst the on the event non-fulfillment Conditions Precedent by the Authority/PLBs extension of time on mutual consent is allowed. Since to balance such act of non-fulfillment of Concession Agreement by any of the parties to the agreement a provision for extension of time on mutual consent should be permitted in particular for concessionaire also in line with the clause (c) Draft Concession We request you to kindly clarify The Concessionaire s representative in the PMU Agreement, Page The role of our representative would only be for coordination of is for coordination of activities with 12

13 29. Zonta 30. Zonta 33, Article 4, Cl. 4.1 activities with PMU/Authority. We understand that there is no full time deputation to PMU office is required from the Concessionaire. PMU/Authority. Draft Concession We request you to modify the clause: DCA remains unchanged Agreement, Page 34, Article 5: The The Concessionaire shall for the due and punctual performance of Concessionaire its obligations hereunder relating to the Project simultaneously obligations with the execution of this Agreement, furnish an unconditional Cl. 5.1: and irrevocable bank guarantee from a scheduled bank in India, in Performance favour of the Managing Director, Kerala State Industrial Security (a) Corporation ", in the form as set out in Schedule 6, ( Performance Security ) for a sum of Rs. 2,00,00,000 (Two Crore only) till the Commercial Operations Date ( COD ). Post COD, the Performance Security shall be reduced to Rs. 1,00,00,000 (One Crore only) till the end of Concession Period or till the Termination Date, as the case may be. Rationale: The Performance security amount of INR 10 Crores till COD and INR 5 Crores for post COD specified are highly restrictive for the DBFOT type contract as the entire responsibilities and risks are assigned to the Concessionaire. We request you to consider a maximum of INR 2 Crores. Similar projects of same size at other states have INR 2 Crores as Performance Security. Further the performance security deposit shall be progressively reduced annually on a pro rata basis during the concession period. Draft Concession We request the Authority to delete this clause DCA remains unchanged Agreement, Page The existing proposed site is only acres with odd boundary 38, General layout and fully utilised for the present compost producing Obligations Cl. operation. No adequate vacant section within the site is available 5.2 (cc) at present. Also, the proposed new WtE plant is to be built at the same site with acres land. Therefore, construction of the new WtE plant and continue operation of the existing compost plant parallelly is not practical. 13

14 31. Zonta 32. Zonta Moreover, as per the Site assessment report of the Project Consultant, the waste receipt and compost plant building area is allocated for scientific landfilling by the Concessionaire. Only possibility during the WtE plant construction period is to divert the waste presently being supplied to Site to alternate location by the Authority and to stop continuing the present composting operation. Draft Concession We request you to modify this clause as: DCA remains unchanged Agreement, Page develop, construct and operate the Sanitary Landfill Site for 36, General disposal of Residual Inert Matter and Rejected Waste and dispose Obligations Cl. not more than permitted/defined limit as per SWM Rules (g) issued by MoEF&CC for landfilling. Kindly refer the clarification sought/justification provided in S. 06 and request you to accordingly modify this clause Draft Concession We request you to modify this clause as: Clause 5.10 of DCA stands modified as given in Agreement, Page. Provided that in case the Selected Bidder is a Appendix 1. 42, General Consortium of entities, then the members of the consortium Obligations Cl. together Jointly shall hold 100% equity capital of the 5.10 (a) Concessionaire, until expiry of 1year from COD, 51% shareholding in the paid-up equity capital until expiration of 10 years from COD and thereafter 26% shareholding in the paid-up equity capital during the remaining Concession period. Kindly refer the clarification sought/justification provided in S. 02 Global companies in general are averse to be a participant in the equity of a project in India and their general preference is to be the technical partner who will take up the project in an EPC model under an arrangement between the Indian partner and the overseas Technology Provider. This is the model prevalent in all newly developed technological sectors in the country including that of the few WTE projects came up recently in India. 14

15 33. Zonta 34. Zonta Thus, we request that it should not be made mandatory to have equity Lock-in for such consortium partner whose Technical credentials have been considered for prequalification and should left to the discretion of the consortium. Draft Concession We request you to modify clause as: DCA remains unchanged Agreement, Page To develop the Project using such technology to establish a Waste 25, Article 2, Cl. to Energy plant having a processing capacity of minimum (j) TPD and a production capability of 5MW Please include minimum before 300 TPD. Production capacity of 5 MW requires more than 300 TPD of Waste Draft Concession We request you to modify the clause as: DCA remains unchanged Agreement: Subject to change in Law resulting in Material Adverse Effect and Article 13, cl 13.1 subject to the Concessionaire taking necessary measures to (b) mitigate the impact or likely impact of Change in Law on the Project, if as a result of Change in Law, the Concessionaire suffers an increase in costs or reduction in net after-tax return or other financial burden ( Additional Cost ) in any Accounting Year, the Concessionaire may so notify the PMU/ Authority and provide the information s as provided in Article (c) below and propose amendments to this Agreement so as to place the Concessionaire in the same financial position as it would have enjoyed had there been no such Change in Law resulting in increased costs, reduction in return or other financial burden as aforesaid. The said remedial measures would be discussed and consequences arising therefrom shall be dealt with as per terms of Article (d) below. Rationale: Any change in law is beyond the control of the Concessionaire and any additional cost to be incurred if any shall be reimbursed. So, we request you to modify the clause accordingly. 15

16 35. Zonta Draft Concession We request you to modify: DCA remains unchanged Agreement: The Concessionaire has failed to process the Solid Waste at the Article 14, cl 14.2 proposed site for a continuous period of 7 (Seven) days in any (b) Month; This period shall be exclusive of the maintenance schedule of the Processing Facility; 36. Zonta Rationale: Considering the unscheduled maintenance/ repairs which may include importing spare parts or unforeseen weather conditions including heavy rainfall in monsoon period, we request to increase the period to consecutive 7 days (exclusive of the scheduled/un-scheduled maintenance period). You may also note that the site facilities can handle storage up to consecutive 7 days. Draft Concession We request you to please confirm DCA remains unchanged Agreement: The plant will not be operational during planned and unplanned Article 5 Cl 5.2 shutdown period. The plant design rating will be suitably (m) increased such that the annual quantity of waste based on 300 TPD will be processed in any year of operation. 37. Draft Concession The Concessionaire hereby agrees and undertakes that it shall DCA remains unchanged Agreement: achieve Financial Closure within 180 (one hundred and eighty Article 6 subclause Conditions Precedent by Authority, PLBs and Concessionaire days) days from the Compliance Date (i.e., completion of all except (c)) Rationale: Kindly refer the clarification sought/justification provided in S. 25 For achieving Financial Closure, Banks/FIs require compliance of all the conditions precedent including DPR, Statutory Approvals and Power Purchase Agreement before sanctioning the debt for the Project Financing. Thus, the Financial Closure shall be achieved within 180 days from the completion of all Conditions Precedent by Authority, PLBs and Concessionaire except (c). We request you to 16

17 38. Zonta 39. Zonta 40. Zonta Draft Concession Agreement: Article 10 Clause 10.4 Withdrawal upon Termination Sub-Clause (b): please amend the clause We request you to modify the clause 100% (Hundred per cent) of Debt Due For achieving Financial Closure, Banks/FIs will seek 100% Debt due to be appropriated from the Escrow Account credits upon Termination. DCA remains unchanged Schedules to We request you to modify the clause 5.9 of Schedules to Schedules to CA remains unchanged Concession Concession Agreement- Schedule 1 as: Agreement: Schedules to Concession Agreement: Schedule 1 Cl. 5.9 The Concessionaire shall ensure that the inert/processing rejects generated from the Processing Facility should achieve total elimination of landfill but in any circumstances not in excess than permitted/defined limit as per SWM Rules 2016 issued by MoEF&CC. We request you to modify the Cl. 6 Schedules to Concession Agreement - Schedule 2 Penalties & Damages as: - Inert/Residual waste greater than 25% sent to landfill Rationale: Kindly refer the clarification sought/justification provided in S. 06 and request you to accordingly modify this clause Schedules to We request you to amend the respective clauses accordingly Schedules to CA remains unchnaged. Concession Please note that only one weighbridge at site will be considered Agreement: for the measurement purpose. Schedule 2: Penalties & Damages, S. 4 Schedules Concession to 17

18 41. Zonta 42. Zonta 43. Zonta Agreement: Schedule 1 Cl Schedules to Concession Agreement: Schedule 1 Cl. 1.3 Schedules to Concession Agreement: Schedule 1 Cl. 5.7 We request you to delete this clause. We consider LD Clause for delays for a DBFOT Contract is not applicable since the entire funding is by the Concessionaire. Any delay in a reasonable project completion will automatically affect the revenue of the Concessionaire and will not incur any losses to the Authority. We, therefore request the Authority to delete this clause which would otherwise increase the financial burden of the bidder. We request you to modify this clause as: The Processing Facility shall achieve COD within a period of 24 (nine) months from the date of completion of condition precedent ( Compliance Date ) and Sanitary Land Fill shall be ready for operation latest by COD. Schedules to CA remains unchanged. Clause 5.7 of the Schedule 1 of the Concession Agreement stands revised as in Appendix 1. The Sanitary Landfill is required only after COD of Waste to Energy Plant and thus the completion date of Sanitary Landfill should be in line with the construction period of Waste to Energy Plant as mentioned in Sl. 01 above. Also please note for the construction of sanitary landfill, the concessionaire has to obtain Environmental Clearance which will take minimum 6-12 months. Thus request to modify the clause accordingly. Schedules to We request you to delete the clause Schedules to CA remains unchanged. Concession The waste collected is processed and the inerts are disposed in the Agreement: scientific manner as per the scope. Thus, there is no waste Schedule 2 recovery applicable and hence we request to please delete this Service Level clause. Benchmarks 3. Extent of 18

19 44. Zonta 45. Zonta recovery of waste collected Schedules to Concession Agreement: Schedule 2 Service Level Benchmarks Penalties & Damages We request you to modify as below: 1. Non-clearance of designated bins for consecutive 2 days - Rs per instance 2. Failure to achieve COD within 90 days of the schedule construction completion date-0.05% of Performance Security per week of delay beyond 90 days Rationale: The mentioned penalty parameters will automatically affect the revenue of the Concessionaire in case of noncompliance and will not incur any losses to the Authority. Also, the frequency of collection depends on the generation of Schedules to CA remains unchanged. waste and optimization of resources. Even, the mentioned penalties and damages are too high and only will restrict participation from prospective bidders and hence we request to consider to revise the penalties as proposed. Site Assessment Please clarify and confirm the scope. As clarified in Sr. 11 above. Study Report of Kindly refer the clarification sought/justification provided in the Project S. 11 and request you to accordingly modify this clause Consultant: Suggested Plant Layout 46. Zonta General Point We request you to please confirm DCA & Schedules to CA remains unchanged. We would request the authority to confirm that the final version of Concession Agreement, in line with the Draft shared along with, may be discussed and deliberated during the award of the project to the Successful Bidder. It is important that as this is an investment project to the State of Kerala, a mutually acceptable document is derived during the contract negotiations without which investment model cannot be viable. 47. Zonta Clause 6 Key We request you to amend the Last Date and Time of The last date of submission of bid is extended to 19

20 48. Zonta 49. Zonta 50. Zonta Details Submission of Tender January 31, S. 16 We request you to kindly provide 30 days time from the date of Last Date and publishing the response to Pre-Bid Queries so as to enable the Time of Bidders to prepare a competent Bid Proposal after assessing all Submission of the Project and Bidding Parameters. Tender 07 th January 2019, IST 14:00 Hrs. Section B, We request to please confirm the applicable Grant or Clause 8, Sub- financial assistance. Please refer to the SBM Urban Guidelines 2017, Clause 8.7 In the it is mentioned that the Authority shall facilitate in issued by MoH&UA, Govt of India. The State Govt. shall facilitate the concessionaire in availing Financial obtaining financial assistance as per SBM or MoH&UA but the the financial assistance as per the guidelines. Assistance under minimum eligible amount or % of project cost is not mentioned. If SBM- Grant any amount or % can be defined, it will enable the concessionaire to make a comprehensive financial analysis and arrive at a competitive quote accordingly This definition needs to be revised as follows: remains unchanged. Equity means the sum expressed in Indian Rupees representing the paid-up equity share capital of the Concessionaire for meeting the equity component of the Total Project Cost, and for the purposes of this Agreement shall include instruments which are convertible into equity share capital of the ; Engineered Sanitary Landfill Site or Sanitary Landfill Site or remains unchanged. Sanitary Landfill or SLF means the Sanitary Landfill Site to be developed, constructed and operated by the Concessionaire at the allocated site in conformance with the terms of this Agreement for disposal of Residual Inert Matter and Excluded Waste; and the site where the Concessionaire conducts a final and safe disposal of Residual Inert Matter, Residual Solid Waste and inert waste, which is designed with protective measures against pollution of ground water, surface water and fugitive air dust, wind-blown litter, bad odour, fire hazard, animal menace, bird menace, pests or rodents, green-house gas emissions, persistent organic pollutants slope instability and erosion in accordance with the terms of this Agreement; 20

21 51. Zonta 52. Zonta 53. Zonta 54. Zonta 55. Zonta 56. Zonta Abandonment means an action on the part of the remains unchanged. Concessionaire with the intent not to discharge its reciprocal obligations partly or wholly related to the Project under the Agreement for a (i) continuous period of more than 15 (fifteen) days during the Concession Period, or (ii) cumulative period of more than 45 (forty-five) days during the Concession Period other than as a result of an event of Force Majeure or a Material Breach of its obligations by the Authority or any PLB or Authority Event of Default; Project shall mean design, engineer, finance, procure, construct, remains unchanged. install, commission, construct/acquire the Project Assets and collection, transportation, processing and disposal of Solid Waste from Waste Generators in the Project Area and discharging the Scope of Services more specifically set out in Schedule 1; 2.1 Subject to and in accordance with the terms and conditions set remains unchanged. forth in this Agreement, the Applicable Laws and the Applicable Permits, the Authority and PLBs hereby grant and authorize the Concessionaire to design, build, finance, operate and transfer (DBFOT) the Project and to exercise and/ or enjoy such rights, powers, benefits, privileges, authorizations and entitlements as set forth in this Agreement ( the Concession ) during the Concession Period and the concessionaire hereby accepts the concession and agrees to implement the Project subject to and in accordance with the terms and conditions set forth herein. 2.2 (b) Upon achieving COD of the Processing Facility, forming part of remains unchanged. the Project, to manage, operate and maintain the same till the Transfer Date; 2.2 (d) To collect, segregate and process entire Solid Waste from the remains unchanged. Project Area and dispose-off the Residual Inert Matter and Excluded Waste/ processing rejects in SLF and / air pollution control residue in secured landfill; 2.2 (l) The Concessionaire may, subject to fulfilling the eligibility remains unchanged. conditions and procuring all required approvals from related regulatory/ statutory authorities, develop, operate and maintain additional recycling or processing facilities on the Site, provided that the same does not cause any adverse effect on its Project related obligations or increases in any manner the financial 21

22 57. Zonta 58. Zonta 59. Zonta 60. Zonta 61. Zonta 62. Zonta liability (including in relation to land requirement) of the Authority and/or PLBs under the Agreement. In the event and so long as the Concessionaire meets the foregoing conditions, the Authority shall render such reasonable assistance that Concessionaire requests in this connection. 2.4 The Authority, may in its sole discretion, in the event the Concessionaire has satisfactorily maintained the Project during the last 5 years of the term, agree to extend the Concession after the expiry of the Term on same terms and conditions. Provided that any such extension shall also lead to an extension of Land Lease Agreement(s) for an equal period so as to make the Land Lease Agreement co-terminus with extended Concession Period. 3.1 (a) The Authority through itself, or through the PLBs shall ensure that within 30 days from the Appointed Date, it shall handover the Sites under their respective jurisdiction for Processing Facility, Landfill, Transfer Stations, Material Recovery Facility, Secondary Collection Points to the Concessionaire on an as-is- where-is basis, free from all Encumbrance, for the purpose of implementing the Project. 5.2 (g) develop, construct and operate the Sanitary Landfill Site at the allocated site in conformance with the terms of this Agreement for disposal of Residual Inert Matter and Excluded Waste and dispose not more than permitted/defined limit as per SWM Rules 2016 issued by MoEF&CC; 5.3 Please add new sub-clause (iii) conditions at the Site which restrict the Concessionaire from constructing/operating the Project / Project Assets. 7.1 (a) Identify and earmark / allocate parcel(s) of land, by itself or by PLBs, within or outside the Project Area for the purpose of setting up of secondary collection points (optional), and the Site for construction of Processing Facility and Sanitary Landfill for scientific management of Solid Waste, within the Compliance Period; 7.2 (c) Identify and earmark / allocate parcel(s) of land forming part of the Site within the project area for the purpose of setting up of Processing Facility and Sanitary Landfill for Solid Waste Management; remains unchanged. remains unchanged. remains unchanged. remains unchanged. remains unchanged. remains unchanged. 63. Zonta 7.1 (f) Shall provide at the Designated Bins minimum tonnage of 300 remains unchanged. 22

23 64. Zonta 65. Zonta 66. Clean Energy Holdings Pte. Ltd. 67. Clean Energy Holdings Pte. Ltd. 68. Clean Energy Holdings Pte. Ltd. 69. Clean Energy Holdings Pte. Ltd. 70. Ram InfoSys Pvt. Ltd. Tonnes Per Day (TPD) of total Solid waste other than Excluded Waste from project areas of PLBs to the Concessionaire on all days of the year during concession period. In case LSGI fails to ensure the minimum assured quantity as set under this Agreement, as evidenced by measurement at the weighbridge checked daily by PMU and/or Concessionaire, the Concessionaire shall be liable to claim penalties for non-fulfilment/ damages, calculated at 25% of the corresponding year Tipping fee per ton for each ton of shortfall. The penalty shall be payable only if the monthly average of quantity received at the site is below 90% of assured quantity (b) 100% (hundred per cent) of Debt Due remains unchanged (f) Add new subclause: Authority and/or PLBs have failed to complete Conditions Precedent as per Article and remains unchanged. For power tariff, base price is not mentioned in the. Power Tariff shall be determined by Kerala State Electricity Regulatory Comission (KSERC), based on detailed DPR and financial analysis presented (page 20), clause Financial assistance or subsidy is not clearly mentioned in the, It would have been better if it is addressed specifically. Performance guarantee amount is high. Please reduce the PG amount. It would have been much better if you can specifically mention designated collection points. Please make the penalty for non-delivery of MSW as a percentage of the cost of investment by the SPV. Since, the penalty of 25% of tipping fee value does not represent clearly the loss to the SPV from non- delivery of waste at the collection centers/bins to it by the Concessionaire. As clarified in item no. 48. remains unchanged. The total road lengths in the participating LSGIs and the maximum distance between two bins shall be provided. But Concessionaire to undertake its own due diligence in this regard. remains unchanged. 71. Ram InfoSys Pvt. Ltd. Please share all the possible technologies that are approved for The project has been conceptualised as technology MSW processing OR all possible technologies that are not neutral thus any technology shall be acceptable as approved. long as it meets all regulatory and environmental norms of the State and Country. 72. Ram InfoSys Please share the number of primary collection areas with GPS The total road lengths in the participating LSGIs 23

24 Pvt. Ltd. 73. Ram InfoSys Pvt. Ltd. 74. Ram InfoSys Pvt. Ltd. 75. Organic Recycling Systems Private 76. Organic Recycling Systems Private 77. Organic Recycling Systems Private 78. GJ Nature Care & Page 10, Point no. 4.3 for stipulated criteria Page no. 17 under Section B project details and scope of the project (PDS), Point 8.6 locations, where Bins have to be provided with waste weight/volume. These are the bins where the waste will be dumped by the street cleaners and other primary collectors. Please clarify If these primary collection centers are in open areas or closed areas. In case of open areas will the PLB or KMC provide civil infra at these locations for the bins to be placed. Since our company and equipment vendors are based abroad and the offices are closed for 3 weeks in the end of Dec and start of Jan We request an extension of the last date for submission of the tender by 30 days. As the proposed project is for processing of 300 TPD MSW it is imperative that the selected bidder has enough technical experience. Hence, we request you to revise the technical criteria as below. (i) Bidder shall have experience of design & development of at least one Waste to Energy Plant of minimum capacity 200 TPD in India or abroad in the period of past five years from the bid due date and the relevant plant is currently in operation; OR successful operation of at least one Waste to Energy Plant of minimum 200 TPD capacity for a minimum period of 1 year in India or abroad in the period of past five years from the bid due date and the relevant plant is currently in operation; We request you to provide the current power tariff. and the maximum distance between two bins shall be provided. But Concessionaire to undertake its own due diligence in this regard. No civil construction is envisaged for Secondary Collection Points. The last date of submission of bid is extended to January 31, Not accepted. Technical Capacity remains unchanged. Power Tariff shall be determined by Kerala State Electricity Regulatory Comission (KSERC), based on detailed DPR and financial analysis presented to it by the Concessionaire. If the bidder proposes Biomethanation technology for processing The bidder shall be free to do that as long as other of 300TPd waste can the bidder instead of setting up 5MW power obligations of the Concessionaire are met. plant can the bidder setup BIO-CNG plant under the guidelines SATAT scheme, issued by MOP & NG, GOI. Currently two plants one for organic and other for plastic are Both plants shall be handed over to operated by the Kozhikode Corporation. Will these plants Concessionaire as part of Site Handover and both 24

25 Energy Private 79. GJ Nature Care & Energy Private 80. GJ Nature Care & Energy Private 81. GJ Nature Care & Energy Private 82. GJ Nature Care & Energy Private 83. GJ Nature Care & Energy Private 84. GJ Nature Care & Energy Private Article 7 & 7.1, DCA Article 7 & 7.2, DCA Article 7.1 (f) of DCA continue to operate and collect waste even after the proposed waste to energy plant is operational? If yes, how will it be done? No clarity about the waste, which already exist in the landfill at the site. The proposed land at Njaliyanparambu also has MSW lanfill, which will require removal, for construction of WTE plant. Please confirm that Authority will remove the existing waste from the landfill and make necessary environmental remediation, before handing over the lead to Concessionaire for construction. The WTE Project also requires development of Sanitory landfill in the proposed land. However, this will not comply with the provisions of Solid Waste Management Rules 2016 as the site is less than 200 meter from Highway and leass than 20km from Calicut International Airport. Request the Authority to provide alternate location for landfill. Does the Concessionaire have right to refuse collection of medical and other hazardous waste? are required to be operated till COD of the proposed Waste to Energy Plant is achieved. Once COD is achieved, the Concessionaire shall be free to use these plants. Please refer Clause 5.2 (cc) of Draft Concession Agreement for clarity. The Site shall be handed over to the Concessionaire on as-is-where-is basis. The Concessionaire shall be responsible for getting the existing legacy waste (not an earmarked landfill) managed at site. EIA of the site shall be undertaken by the Concessionaire for getting environmental clearance from State Level Environmental Impact Assessment Authority. Yes, the Concessionaire shall reject all medical and hazardous waste for the proposed project. Please provide details if sewerage treatment plant from where The water shall be provided by Kozhikode water has to be transported. Clarification required whether treated Municipal Coproration at the Project Site and any water can send back to same river, right of way for pipeline laying treated water, shall be discharged as per etc. environmental norms. The Concessionaire shall LSGIs, will be liable to pay penalty to SPV calculated at 25% of the corresponding year tipping fee per ton for each ton of shortfall. The penalty shall be payable only if the monthly average of quantity received at the Site us below 90% of assured quantity. This can affect the revenue for the SPV with regard to Tipping Fee as well as the loss of revenue from redeuction in electricity production (due to lack of waste) There are some concerns regarding the Site Assessment Report e.g. (i) Inages shown groundwater report taken from 1983 (ii) Report shows higher calorific value (CV) for waste strive to achieve a zero discharge facility. remains unchanged. Groundwater data has been taken from the CGWB भभभभ भभभभभ भभभभभभभभ, भभभभभभभभ भभभभभभभ, भभभभ भभभभभ GROUND WATER INFORMATION BOOKLET 25